KPMG’s “The Great Exit” report signals a critical inflection point: between January and June 2025, labor force participation among mothers with young children dropped by 2.8% — the steepest decline in over 40 years. For many families, child care challenges left them with no choice but to step back.
This isn’t just a family challenge — it’s a talent strategy crisis. When care breaks down, organizations face measurable impacts: lost productivity, higher turnover, and rising replacement costs. Employers who treat care as a core part of their talent strategy and not just a benefit are best positioned to retain top talent and drive engagement.
Why are moms leaving the workforce?
Women with young children (particularly those with a bachelor’s degree or higher) are exiting the workforce at unprecedented rates. The key drivers include:
- Child care center closures
- Return-to-office pressures
- Unsupportive workplace policies
Inside today's child care challenges
The pandemic didn’t just disrupt child care; it brought longstanding challenges into focus. Temporary federal funding helped stabilize providers during a period of uncertainty, but when that support ended in late 2023, hiring stalled. Today, the sector faces a shortfall of 100,000 early childhood educators compared to pre-pandemic projections, leaving families and employers navigating a widening gap.
A child care system struggling to keep up
Child care needs aren’t slowing; they’re accelerating, driven largely by Millennials and Gen Z starting families. That surge in demand is colliding with a U.S. child care sector already under strain from rising demand, persistent labor shortages, and increasing costs. These challenges don’t just inconvenience families; they disrupt productivity and ripple across the broader economy.
What's at stake for employers?
Child care breakdowns aren’t just a line item; they’re a signal that talent strategies need to evolve. Each month, more than 1.3 million workers are affected by inadequate child care. Disruptions have doubled in the past decade, and the cost is measured in billions of lost wages and work hours.
But the real risk isn’t just absenteeism; it’s disengagement. When working parents feel unsupported, they’re more likely to step back, seek new opportunities, or simply “job hug” until something better comes along. In a market where every hire counts, that’s a risk employers can’t afford to ignore.
The good news? Employers have the power to change the narrative. The organizations that stand out aren’t just reacting to the crisis; they’re building cultures where care is foundational, not optional.
What sets employers apart?
- Proactive listening: They know their people, regularly surveying employees to understand pressure points and care needs.
- Creative solutions: From in-office summer camps to flexible schedules, they address trouble spots with innovation, not just policy.
- Reliable care partners: They invest in full-service programs so employees can count on support when it matters most.
Building a future-ready workforce
Nearly 60% of parents who are out of the workforce or working part-time say they’d return to full-time employment if child care were accessible. For HR leaders, that’s not just a statistic — it’s a talent pool waiting to be re-engaged.
The takeaway? Now is the time to be proactive. By embedding care into your talent strategy, you’re not just solving today’s challenges — you’re building trust, loyalty, and resilience for tomorrow.
Learn how Bright Horizons can help you turn care into a competitive advantage.
